Merchant Accounts

Merchant Accounts


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Bank Check Processing

Written by Patricia Tunstall
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Bank Check Processing Is Cumbersome

Bank check processing is not only time-consuming, but out-of-date. If, for instance, an online customer wants to make a purchase, old-fashioned handling involved mailing in a check, waiting for the bank check processing to clear it, and then shipping the merchandise. Such roadblocks discourage online purchases, and the merchant loses a sale.

With the advanced technology of ACH check processing, merchants can instantly use the electronic processing to accept customer payment either online or at the point-of-sale. A business owner's website has a secure section in which the customer enters financial information, either for a credit card or check. The server sends the customer's information to the appropriate bank, and within seconds the check is approved or declined.

Perils of Bank Processing

The slow nature of bank check processing permitted some consumers to write a check on insufficient funds, then cover it later. If this attempt to beat bank processing failed, the check bounced. The business owner was then left hoping to contact the check writer; if the personal information on the check was incorrect, or if the consumer failed to make restitution, the merchant would have to write off the loss.

Today, with instantaneous electronic transfer, merchants can accept online checks or point-of-sale checks virtually risk-free. The cumbersome, lengthy handling of checks through deposits and bank procedures not only failed to prevent fraud, but put the actual funds into the merchant account many days later, in some cases. ACH processing services offer electronic handling of check, credit, and EBT transactions so merchants have immediate approval.

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